X Company

ABC Division
Flexible Budget
For the month of August 2019
Normal
Capacity

Direct labor hours 1,200.00 1,350.00 1,500.00 1,650.00

80% 90% 100% 110%

Variable
Indirect labor 2.25 2,700.00 3,037.50 3,375.00 3,712.50
Factory supplies 1.20 1,440.00 1,620.00 1,800.00 1,980.00
Power 0.35 420.00 472.50 525.00 577.50
Rework operations 0.50 600.00 675.00 750.00 825.00
Payroll taxes 0.35 420.00 472.50 525.00 577.50
Repair and maintenance 0.15 180.00 202.50 225.00 247.50
General factory 0.20 240.00 270.00 300.00 330.00
Total variable costs 6,000.00 6,750.00 7,500.00 8,250.00

Fixed:
Indirect labor 2,500.00 2,500.00 2,500.00 2,500.00
Supervision 1,800.00 1,800.00 1,800.00 1,800.00
Factory supplies 500.00 500.00 500.00 500.00
Power 150.00 150.00 150.00 150.00
Rework operations 600.00 600.00 600.00 600.00
Payroll taxes 1,000.00 1,000.00 1,000.00 1,000.00
Repair and maintenance 350.00 350.00 350.00 350.00
Property insurance 150.00 150.00 150.00 150.00
Property taxes 200.00 200.00 200.00 200.00
Vacation pay 1,800.00 1,800.00 1,800.00 1,800.00
Employee pension costs 1,200.00 1,200.00 1,200.00 1,200.00
Employee health plan 500.00 500.00 500.00 500.00
Machinery depreciation 450.00 450.00 450.00 450.00
Water and heat 400.00 400.00 400.00 400.00
Building occupancy 900.00 900.00 900.00 900.00
General factory 1,000.00 1,000.00 1,000.00 1,000.00
Total fixed costs 13,500.00 13,500.00 13,500.00 13,500.00

Total costs 19,500.00 20,250.00 21,000.00 21,750.00

 X Company
ABC Division
Variance Analysis Report
For the month of August 2019

Budgeted
Allowance at Budgeted
Normal Allowance - Actual FOH Spending
Direct labor hours Capacity Actual Volume costs Variance
1,350.00 1,290.00
90% 86%
Variable
Indirect labor 3,037.50 2,902.50 3,250.00 347.50 Unfavorable
Factory supplies 1,620.00 1,548.00 1,654.00 106.00 Unfavorable
Power 472.50 451.50 465.00 13.50 Unfavorable
Rework operations 675.00 645.00 488.25 (156.75) Favorable
Payroll taxes 472.50 451.50 451.50 - Indifferent
Repair and maintenance 202.50 193.50 1,175.75 982.25 Unfavorable
General factory 270.00 258.00 385.00 127.00 Unfavorable
Total variable costs 6,750.00 6,450.00 7,869.50 1,419.50 Unfavorable

Fixed:
Indirect labor 2,500.00 2,500.00 2,500.00 -
Supervision 1,800.00 1,800.00 1,800.00 -
Factory supplies 500.00 500.00 500.00 -
Power 150.00 150.00 150.00 -
Rework operations 600.00 600.00 600.00 -
Payroll taxes 1,000.00 1,000.00 1,000.00 -
Repair and maintenance 350.00 350.00 350.00 -
Property insurance 150.00 150.00 165.00 15.00
Property taxes 200.00 200.00 210.50 10.50
Vacation pay 1,800.00 1,800.00 2,200.00 400.00
Employee pension costs 1,200.00 1,200.00 1,200.00 -
Employee health plan 500.00 500.00 500.00 -
Machinery depreciation 450.00 450.00 450.00 -
Water and heat 400.00 400.00 465.00 65.00
Building occupancy 900.00 900.00 900.00 -
General factory 1,000.00 1,000.00 1,000.00 -
Total fixed costs 13,500.00 13,500.00 13,990.50 490.50 Unfavorable

Total costs 20,250.00 19,950.00 21,860.00 1,910.00 Unfavorable

Budgeted hours 1,350.00

Predetermined FOH rate 15.00